W.H. rejects labor’s bid for Obamacare exemption

The Obama administration on Friday told labor union leaders that their health plans would not be eligible for tax subsidies under Obamacare next year.

A White House official said the Treasury Department has concluded that such an exemption is not possible under the Affordable Care Act. The labor unions have been asking that their union plans, known as Taft-Hartley plans, be eligible for premium subsidies the way plans on the new insurance exchange will be.

Labor officials met privately with President Barack Obama, Vice President Joe Biden and Labor Secretary Tom Perez on Friday afternoon to press their case that the Affordable Care Act will have consequences for the benefits of union employees.

The president “heard the concern about the future of the nonprofit plans,” the senior administration official said.

The Treasury Department spelled out the details of the administration’s decision in a letter Friday to Sen. Orrin Hatch (R-Utah) and Rep. Dave Camp (R-Mich.).

“The Treasury Department issued a letter today making clear that it does not see a legal way for individuals in multi-employer group health plans to receive individual market tax credits as well as the favorable tax treatment associated with employer-provided health insurance at the same time,” the White House official said in a statement.

“The president expressed in the meeting that he wakes up every day thinking about how to help working Americans and build the middle class — he also expressed that the Affordable Care Act will work to create new affordable health care for millions of Americans this year,” the official added.

Labor officials worry that the lack of subsides for those multi-employer Taft-Hartley health care plans could encourage employers to move unionized employees onto the public exchanges created by the new law. They also worry that the law could encourage employers to move some full-time employees to part-time to avoid having to provide health insurance.

As a result of the disagreement over the implementation of the health care law, union officials and their rank-and-file members have been among the most vocal critics of the Affordable Care Act — Obama’s signature domestic achievement — in recent weeks. Before the law’s passage, unions were vocal supporters.

The nation’s largest labor group — the AFL-CIO — concluded its annual meeting in Los Angeles earlier this week by strongly condemning the law in a statement that said it was “highly disruptive” to union benefits.

“On behalf of the millions of working men and women we represent and the families they support, we can no longer stand silent in the face of elements of the Affordable Care Act that will destroy the very health and well-being of our members, along with millions of other hardworking Americans,” the Teamsters, UFCW and UNITE HERE wrote in a joint letter this summer.

White House officials did discuss how to make the plans eligible to enter the exchanges, which would require several changes to how many of the plans operate today. Many of the union plans, as they exist, do not accept all applicants — just one of the reasons they wouldn’t qualify to offer their insurance on the exchanges.

Union officials emerged from the meeting in no mood to talk to reporters after more than an hour of closed-door consultations with the president and administration officials.

“It was a good meeting,” Trumka told reporters in a short statement as he left the White House grounds. “We’re continuing to work on problem solving. You’ve got the only quote you’re going to get.”

The AFL-CIO declined to comment on the White House’s decision.

Not all labor unions oppose the law.

The SEIU remains supportive of Obamacare — even announcing this week that it was pitching in for outreach and enrollment efforts across the country.